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FBAA meets with government to discuss clawbacks

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Australian Broker | 25 Nov 2015, 08:01 AM Agree 0
The FBAA has met with the Minister for Small Business and Assistant Treasurer, Kelly O’Dwyer to discuss unfair clawbacks
  • Joe Broker | 25 Nov 2015, 09:13 AM Agree 0
    This is very encouraging Peter. Watching this space with keen interest.
  • Bottom Line | 25 Nov 2015, 09:19 AM Agree 0
    Nice work Peter. Switching to you guys as soon as my renewal is up at the other place!
  • Katherine | 25 Nov 2015, 09:23 AM Agree 0
    No other business where this happens... Try the life insurance industry which has a 2 yr clawback period which was just negotiated down from 3 years in addition to being forced to take up to a 50% drop in new business commissions. Wish the you best of luck though...
  • country broker | 25 Nov 2015, 10:24 AM Agree 0
    Good on you Peter. I too will be switching to FBAA. Even if you don't win (which I certainly hope you will) it's finally great to see you taking action and fighting for us.
  • Larz | 25 Nov 2015, 10:39 AM Agree 0
    Any brokers who think that clawbacks are not an essential part of the commission system are dreaming. Without clawbacks there can be no upfront payments. If a loan pays out after 12 mths for whatever reason and the lender has paid out 60 points up front they have to get their costs back somehow. A pro rata arrangement would be the fairest and would be easy to implement. The idea of 100% at 18mths is too heavily weighted in favour of the lender.
  • Paul Charnley | 25 Nov 2015, 11:14 AM Agree 0
    Well done Peter White of FBAA, looking after your members business interests.
  • Steve Reid | 25 Nov 2015, 11:27 AM Agree 0
    Good work Peter. The other major subject is lenders raising the rates on there existing books to raise capital while still making billions!! This is the biggest joke of all time.

    Fair enough on new business, but on loans currently settled?What a joke.

    What business in Australia can go back and change their margins?

    This practise should be banned. The lenders should hold enough margin, if they don't it should not be put on the existing customers who have to spend More money to refinance.

    Thanks, Steve.
  • Dave Robinson | 25 Nov 2015, 12:00 PM Agree 0
    Good work Peter. Katherine I think it would be better if you compared apples with apples and not oranges. I am not sure you have a comprehensive understanding of the two industries, what's involved to write each respective product, turn around times, payment times etc. I believe you are way off the mark and I have come to expect that type of comment from a journalist or a choice spokesman. Check it out a little further and I think you may change your comment.
  • Peter White CEO FBAA | 25 Nov 2015, 12:16 PM Agree 0
    @Larz - thanks for you input (be more interesting to know who you really are though) but you obviously don't know this industry very well and you mustn't have been in it for very long, as unfair clawbacks never use to exist and there is a fair remedy to the same. But that's not for now.
  • HEM | 25 Nov 2015, 01:44 PM Agree 0
    Thanks Peter for going to bat for us.
  • Sharon Smithers | 25 Nov 2015, 01:46 PM Agree 0
    Thank you for taking on the battle noone else would. My membership will definitely be switching once my current membership is at an end.
  • MMW | 25 Nov 2015, 02:45 PM Agree 0
    Hi Peter,
    I switched from MFAA to FBAA as the FBAA represents BROKERS interests only. I realised that after being with the MFAA for ages.

    I now know I made the right decision. Thank you for looking after brokers interests and the FBAA is the only organisation in the industry that is the voice of the brokers. You got my vote.
  • RC | 26 Nov 2015, 07:49 AM Agree 0
    Dave, your comment about Katherine not having a comprehensive understanding of our industry is a little of the mark. I have been a Life Risk Writer for 33 years & a mortgage broker for 13. The now current compliance & process of each structure to achieve the goal of a successfully completed loan or insurance application is now quite involved. The time aspect is similar from a start to finish process based on the appointments required & the process required. I am trying to keep this short NO Brokers are NOT the only privileged "beast" to get claw backs with worse consequences. I had a recent deal 11 days short of 12 months with a lender I write a reasonable number of loans with. Was made aware of the discharge as a result of a sale at the last moment & forewarned the Lender & asked if they would be lenient with me. No such response. Received the necessary clawback applicable. Have had the same happen with insurance. I commend Peter's effort to try & squash "unfair claw backs" which I would suggest the above example would fit the "bill". Both industries have their different complexities to achieve the result required for our client. So Dave not sure if you are on the "Mark"
  • Larz | 26 Nov 2015, 11:13 AM Agree 0
    Peter yes I do remember when clawbacks were not an issue but that was in the pre-exit fee / DEF ban days where the responsibility of an early discharge lay where it should with the borrower not the broker.
  • Ray Weir | 26 Nov 2015, 12:31 PM Agree 0
    I'd tread warily with the Government else they may turn their attention to trailing commission, which I'm sure they would like to cut out as is the case in the USA and UK.
  • Aged Broker | 27 Nov 2015, 11:17 AM Agree 0
    I can't understand all the drama about clawbacks. As a broker of sixteen years, I have suffered probably 3 clawbacks.

    If you are looking after your clients both upfront and beyond settlement, then they should return to you if they are unhappy with their lender. If a refi is required, a new upfront commission should cover any clawback.
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